AltaLink Continues to Build Unnecessary and Expensive Power Lines

Electricity transmission experts in Alberta have been indicating for years that AltaLink, owned by U.S. energy behemoth Berkshire Hathaway Energy, has been proposing and building unnecessary overhead high voltage transmission lines because AltaLink does not have to pay for them – Alberta electricity consumers pay for 100% of the cost to build new transmission lines. This is one of the reasons Albertans pay among the highest electricity transmission rates in Canada.

Kevin Van Tighem points out yet another example of this absurdity in this recent article about AltaLink’s proposed Castle Rock Ridge to Chapel Rock Transmission Project in the Pincher Creek area of southern Alberta. Van Tighem suggests one of the reasons AltaLink wants to build this expensive line is so they can link into an existing north-south line in order to sell our wind power to “Americans hungry for green power”. AltaLink has been interested for years in exporting electricity produced in Alberta to the United States, and since Berkshire Hathaway Energy bought AltaLink from scandal-plagued SNC-Lavalin, this interest now appears to be one of AltaLink’s top priorities.

To make matters worse, the estimated construction cost of the Chapel Rock line has mushroomed from $150 million to more than a whopping $750 million, a five-fold increase. In the normal business world, such an increase would render the project unfeasible; however, since it is not AltaLink that will pay this exorbitant price – rather it is Alberta consumers – AltaLink doesn’t really care. This unique arrangement in Alberta is also one of the reasons costs to build new overhead high voltage lines in Alberta are far higher than anywhere else in North America. Only in Alberta can transmission line builders have their cake and eat it too.

Unfortunately, both Alberta’s electricity operator (AESO) and regulator (AUC) support exporting our electricity to the U.S., while Albertans are forced to pay for the high voltage transmission lines. The triumvirate of power – AESO, AUC, transmission industry – ensures that Albertans will continue to pay among the highest prices in Canada for electricity transmission.

As Van Tighem concludes in his article, “The smart first step in transitioning Alberta’s energy economy would be to require power companies to pay their own way. That would help replace white elephants like Chapel Rock with the smart projects we actually need.”

P.S. Even though SNC-Lavalin sold AltaLink to Warren Buffett’s Berkshire Hathaway Energy in late 2014, SNC-Lavalin will continue to build AltaLink’s high voltage transmission lines. Some in the industry argue that SNC charges inflated construction costs.